INVESTIGATION: Major NATO Corruption Case Derailed by US Political Intervention

The procurement agency of NATO has been facing scrutiny regarding its arms and munitions deals. In May 2025, revelations regarding an ongoing corruption investigation involving current and former staff at the NATO Support and Procurement Agency (NSPA) surfaced, with five detentions reported, including two in Belgium and three in the Netherlands. At the heart of the purported corruption lies a plan to award NATO contracts for military supplies and services in return for bribes. 

This NATO corruption scandal captured global attention when multiple suspects were apprehended throughout Europe in May, including a US national. Months later, the U.S. dismissed charges against four of these individuals – one of whom is a prominent Turkish defense tycoon close to Erdogan.

In  May 2025, the Belgian public prosecutor announced that multiple arrests had been conducted, indicating they were related to “possible irregularities” in contracts for purchasing ammunition and drones through NATO. Shortly after, Dutch authorities revealed they had made three arrests, including a 58-year-old former Defense Ministry official whose prior role involved international procurement contracts. In Luxembourg, the public prosecutor’s office confirmed that documents had been confiscated in the Grand Duchy and noted that the investigation had also extended to Italy, Spain, and the US, with coordination from the EU justice agency Eurojust.

On the morning of May 13, Scott Willason, an American who had resigned from his position as the head of the Ammunition and Support Branch at the NATO Support and Procurement Agency (NSPA) to pursue a career in the private sector, was taken into custody in Lugano, Switzerland. Willason found himself entangled in a broad police operation that extended across multiple European nations, aimed at five current and former NATO officials, who are now consultants, attempting to sway bids for Alliance arms contracts in return for substantial commissions. Willason’s apprehension came after a collaborative investigation conducted by the US Department of Justice’s (DOJ) Federal Bureau of Investigation (FBI) alongside the Pentagon’s Defense Criminal Investigative Service. In the United States, these two agencies uncovered several questionable transactions associated with a significant contract for supplying TNT to the US Army.

One of the other significant figures involved in the scheme was Ismail Terlemez, a friend and ex-colleague of Scott Willason from NSPA, who was taken into custody at Brussels Airport on the same day as Willason’s arrest. Notably, Terlemez appears to have a strong connection with Turkish President Erdoğan. The investigation indicates that the case dismissals in the US coincidentally occurred soon after U.S. President Donald Trump talked about defense industry collaboration with his Turkish counterpart at the end of June 2025. Meanwhile, legal experts in the US raise concerns about the risk of the US Department of Justice becoming a weapon for the White House.

The 14-page federal indictment from the US outlines the financial transactions between Willason and an Italian firm operating in that industry. From November 2019 to June 2020, the consultant billed the company slightly more than €1 million for services that the indictment alleges were intended to assist in securing the contract.

IMAGE: United States District Court For The Northern District of Illinois. Case 1:25-cr-00207 USA vs Scott Wiilason and Ismail Terlemez

The docket entry made by the Clerk on Thursday, July 10, 2025, confirms the US Government’s motions to dismiss the indictments against Scott Willason and his alleged co-conspirator, Ismail Terlemez. The court ordered that the defendants were to be released from custody.

DOCUMENT: MINUTE entry before the Honorable Franklin U. Valderrama in the case USA v Scott Willason and Ismail Terlemez. US Government’s motions to dismiss the indictments without prejudice (Source: Pacer Monitor)
USA_v_Willason_et_al__ilndce-25-00207__0011.0

For NATO, the timing couldn’t have been worse. Observing Russia’s significant military buildup during its ongoing conflict with Ukraine, NATO member nations were experiencing an unprecedented surge in defense spending that was expected to last for years. During the NATO conference held in Antalya, Turkey (14-15 May 2025),  the secretary-general of the military alliance, Mark Rutte, informed journalists that the agency itself initiated the decision to start investigations. NSPA is based in the Grand Duchy of Luxembourg, with primary operational hubs located in France, Hungary, and Italy, along with a branch in Kosovo. The Agency has approximately 1,550 employees and manages more than 2,500 contractors involved in NATO missions globally.

However, uncovering the truth behind the purported corruption case turned out to be impossible due to political interventionism. An inquiry conducted by Follow the Money, along with French news outlet La Lettre, Belgian media Knack, Le Soir, and three other media partners, reveals that the U.S. Department of Justice (DOJ) discreetly dismissed its charges against four suspects involved in two separate cases in July. Three of these individuals, who had been detained, were freed within days, just as they were on the verge of being extradited to the U.S.

Legal experts are questioning what appears to be an obvious US political interference in a major NATO corruption case…

Simon Van Dorpe and Jesse Pinster report for Follow the Money…

U.S. pulls plug on major NATO corruption probes – top suspects walk free

A NATO corruption scandal made international headlines when several suspects were arrested across Europe in May. Several months later, the U.S. dropped charges against four of them – including a Turkish defence magnate – despite strong evidence, a joint investigation reveals.

One man arrested at Brussels Airport, another when he dropped off his kids at school in Switzerland, and similar scenes in Spain and the Netherlands: A sweeping police crackdown saw eight arrests and raids across seven countries in the most high-profile NATO corruption cases since its foundation.

It was mid-May 2025, and authorities believed that the suspects had been involved in corruption at the military alliance’s procurement agency NSPA and the Dutch Ministry of Defence. The Luxembourg-based agency provides logistical support to NATO missions and allows member states to buy services and military equipment – such as ammunition, spare parts for tanks, and fuel.

“We want to get to the root of this,” NATO Secretary General Mark Rutte told journalists the next day. “We do not accept, as NATO, any form of [violations] of judicial principles.”

But getting to the bottom of the alleged corruption case wouldn’t happen as promised, an investigation by Follow the Money, French news outlet La Lettre, Belgian media Knack and Le Soir and three other media partners shows. The U.S. Department of Justice (DOJ) quietly dropped its charges against four suspects in two different cases in July. Three of them, who had been in custody, were released within days, just when they were about to be extradited to the U.S.

This raises questions of political interference, three former Justice Department officials told Follow the Money and its media partners.

“It’s unheard of in normal justice department events that slam-dunk cases are dismissed on a motion like this,” a former official who looked into the documents said.

“All light must be shed on the suspicions of interference by the Trump administration” 

At the core of the alleged corruption is a scheme to hand out NATO tenders for military equipment and services in exchange for kickbacks.

In four related cases, U.S., Belgian, and Dutch authorities were investigating 11 suspects. Three suspects were arrested in the Netherlands, three in Belgium, one in Switzerland, one in Romania, and one in Spain. Police also raided premises in Luxembourg, Italy, and in the U.S. They were, or are still, accused of bribing, or accepting bribes, while working on military tenders. The suspects in three of the cases were part of, or connected to, the same NSPA team in Luxembourg. 

The network

While charges have been dropped in the cases related to the U.S. investigation, two suspects remain in jail. When investigating corruption at NATO, journalists uncovered a network of suspects. Read who is behind it here. Belgian and Dutch prosecutors both started their cases after a tip from the U.S. Federal Bureau of Investigation (FBI), according to two people familiar with the matter.

For the investigation, Follow the Money and its media partners reviewed previously unreported casefiles and legal correspondence and spoke with suspects and their lawyers, national authorities, former department of justice officials, and experts.

French EU lawmaker Chloé Ridel, of the Socialists and Democrats, condemned the move by the U.S. administration.

“All light must be shed on the suspicions of interference by the Trump administration,” she said. “We won’t let it pass.”

As the four people who were part of the U.S. case have not been found guilty – or able to present their defence in court – all are presumed innocent. The DOJ did not respond to requests for comment. NATO spokesperson Allison Hart said the defence alliance could not comment on ongoing cases.

“The NSPA initiated cooperation with national law enforcement agencies and continues to offer full support to their respective probes of alleged criminal activity by a number of current and former agency personnel,” she said.

From civil servant to defence magnate

One of the key people in the scheme is Ismail Terlemez, the U.S. indictment documents show.

Born in the town of Mecitözü in central Turkey, the 43-year-old has forged an impressive career. He initially served in the Turkish army, working on ammunition before switching to NATO’s NSPA.

He’s now the chairman and main owner of one of the country’s largest and fastest-growing defence companies, Arca. With demand for ammunition booming in recent years, he’s been able to quickly grow his startup into a national defence champion and a rising global contender.

But his success hides a more troubled past: suspected of taking bribes while working at the NSPA in Luxembourg, he was nabbed by police at Brussels Airport on 13 May while on a visit to Belgium, according to one of the legal documents and a source familiar with the matter.

The allegations date back years: the alleged scheme started when Terlemez was still a technical officer at NSPA – responsible for evaluating bids made by defence companies in public tenders. In March 2019, he played a crucial role in deciding who would win a major contract to supply the U.S. military with the explosive TNT, according to the indictment.
The contract went to an unnamed Italian company, which, in the view of U.S. attorneys at the time, Terlemez had helped win the tender in exchange for bribes.

“Both the motions to dismiss on the same exact day – that would be like lightning striking your house twice in one day”

In apparent exchange, that company had handed the Turkish NSPA official, via a consultant and former colleague of his, “a stream of benefits” that totalled 115,896.74 euros. A bit more than a year after he helped the Italian company, in July 2020, Terlemez left NSPA and founded Arca in the Turkish capital of Ankara in August 2020.

It didn’t take long for Arca to be a success. In June 2021, Terlemez reached an agreement with Turkey’s state-owned defence company MKE, which guaranteed the purchase of 120 million bullets over a period of 25 years. The bullets, rockets and heavy-calibre ammunition would be produced in a vast ammunition factory in the town of Sungurlu in Terlemez’s home province. In 2022, Turkish President Recep Tayyip Erdoğan attended the laying of the first stone via video link.

Terlemez and Arca did not respond to requests for comment.

A lucrative business

Clients started lining up for the new supplier.

In early 2024, the U.S. military bought 116,000 rounds of battle-ready ammunition shells from Arca, Bloomberg reported in March that year. In October of the same year, Arca secured a record 2-billion-dollar deal with the Slovakian defence group MSM. Arca was in talks about weapon deliveries with Sudan’s paramilitary Rapid Support Forces, the Washington Post reported in March this year. The group is accused of genocide and ethnic cleansing by the U.S.

Terlemez spent almost two months in prison before he, together with two other suspects in two of the related corruption cases, was, without apparent warning, released in July. All charges against him were dropped.

The continued prosecution of these cases “would not serve the interests of justice”, the DOJ argued in the motions to dismiss the indictments, which are both signed by Gail Slater, the recently instated U.S. assistant attorney general. In one of the motions, the DOJ stressed that it had full discretion over which cases it wanted to bring and which to dismiss.

Experts believe that the dismissal of the cases was for political reasons, rather than developments in the investigation.

“It’s highly unusual to drop any case like this,” said a former DOJ official, who had worked at the department for over two decades, including on similar cases. “Both the motions to dismiss on the same exact day – that would be like lightning striking your house twice in one day.”

The Department of Justice and the attorneys working on the cases did not respond to requests for comment.

The time spent in jail doesn’t seem to have had an impact on Terlemez’s company: In June, Arca bought an Italian company which specialises in the recovery of materials from military ammunition. Arca is also currently negotiating the takeover of prominent French defense company Manurhin.

Teaming up with a former boss

The same day Terlemez was arrested in Brussels Airport, U.S. citizen Scott Everett Willason was driving his kids to school in Lugano, Switzerland. He had just dropped off one of them when his car, with his other child inside, was approached by armed cantonal police.

They ordered him to come with them to the station, and Willason would spend the next 60 days in a prison in Lugano. He was accused of being the middleman who transferred the alleged bribes from the Italian company, which was his client, to his friend and former NSPA colleague Terlemez. After serving in the U.S. Army, Willason joined the NSPA around the year 2000. He climbed the ranks and ended up leading the ammunition support branch, where Terlemez worked for him.

Willason quit the NSPA in 2018 and set up consulting companies in Luxembourg, Poland, and Italy. In 2020, he moved with his wife and kids from the clouded Luxembourg to the bright Lugano, at the lake, in southern Switzerland.

It was around this time (Between November 2019 and June 2020) that Willason’s Luxembourg-based consulting company – unnamed in the indictment – received just over 1 million euros, in five payments, from the Italian company. His consultancy then transferred, also in instalments, almost 116,000 euros to Terlemez’s private account. “Willason provided Terlemez with a stream of benefits,” the indictment reads, “while Terlemez took acts favourable to Willason’s client in connection with a trinitrotoluene (‘TNT’) contract for the United States Army facilitated by NSPA”.

The indictment also described another scheme to demonstrate that Willason and Terlemez were conspiring.

In February 2020, Terlemez met with the CEO of Latvian ammunition manufacturer Vairog EU, who was seeking to secure NSPA contracts, in a hotel in Luxembourg. He recommended that the executive to get in touch with Willason, and said that working together would benefit everyone.

Note: The then-CEO of Vairog EU, Juris Ozols, declined to comment. Vairog EU has, under its new owner, been renamed to Ammunity. The new owner did not respond to requests for comment.

An hour later, Willason contacted the CEO; that same day, they met in another hotel in Luxembourg. Willason allegedly told the CEO that he could raise his prices and still win NSPA contracts. Yet, according to the indictment, he proposed a deal in which Willason’s Poland-based consulting firm would pocket half of the amount by which the Latvian company raised its prices.

“It was part of the conspiracy that Terlemez steered [the Latvian company] to Willason, so that Willason could offer consultancy services to [the Latvian company] for potential contracts with NSPA,” the U.S. attorneys alleged.

At no point did the indictment mention that Vairog accepted or showed interest in the offer.

That was enough evidence for U.S. investigators. In 2025, they issued an arrest warrant, and Swiss authorities arrested Willason on charges of conspiracy and bribery.

Scott Willason’s lawyer, Pascal Frischkopf, said that much of the information reflected in this article is “inaccurate, misleading, and incomplete,” without specifying further. “What truly matters is that … all charges and further investigations were immediately dropped and fully closed.”

Like Terlemez, Willason would spend just below two months in prison on bribery charges – before being released around the same time and briefly before he was to be extradited to the U.S.

NATO declined to comment on the U.S. dismissal of the investigations.

Not the only ones 

Terlemez and Willason aren’t the only two suspects in NSPA-related cases that have been released from European prisons after American authorities dropped the cases. A third suspect was allowed to leave a Romanian prison on the very day Terlemez and Willason could walk free: Greek businessman Manousos Bailakis.

Bailakis was facing allegations of bribery in a separate case. He was arrested three months before Terlemez and Willason, in February 2025. Bailakis was the chief operating officer for the Romanian company Global Defence Logistics (GDL). The firm offers a wide range of services for military ships and aircraft, including fueling, repairs, waste management, and the provision of internet connectivity and containers.

Together with the part-owner of GDL, Ioannis Gelasakis, who also worked for the company, Bailakis was accused of having paid bribes to an unnamed NSPA official. They allegedly paid the person 130,000 euros – and promised over 1 million euros more – to make sure GDL got a contract with NSPA, the DOJ wrote in its March indictment.

The contract was worth up to 450 million euros, of which GDL would get half, according to the indictment.

“Clear political interference. That is the only rational explanation.”

During two meetings in July and October 2024, Bailakis and Gelasakis allegedly handed the cash – 50,000 euros per meeting – over to the official. The payments took place in two different hotel rooms in Frankfurt, Germany, and during a third meeting, with some 30,000 euros, in a hotel in Bucharest, Romania, in January 2025. Pictures were taken of the cash by an undisclosed source, and the official who received the money was not charged by the U.S. government.

Two weeks after the Bucharest hotel meeting, U.S. authorities issued arrest warrants for Bailakis and Gelasakis.

While Gelasakis remained at large, Bailakis was apprehended on 21 February in Bucharest. Three months later, his lawyer, Aaron Katz wrote that his client agreed to be extradited to the U.S.

On 9 July, the U.S. Department of Justice requested the court to dismiss the indictment. This seems to have come as a surprise to Bailakis’ lawyer, who, on the morning of the same day, had sent a letter to the U.S. judge with details about his extradition, which was scheduled to take place two days later.

Charges against Gelasakis were also dropped the same day.

Another case with largely the same allegations was opened at the end of February by the Romanian anti-corruption prosecutor’s service, DNA. A spokesperson for the agency said this investigation is still ongoing.

“I categorically deny any involvement in the criminal activities mentioned in your correspondence,” Gelasakis said.

He added that he was never “officially informed” of any arrest warrant issued against him and that his address was known to the authorities.

A lawyer for GDL said that Gelasakis was no longer with the company.

“The company has also initiated proceedings to remove him from the partnership. GDL absolutely does not tolerate bribery and has no knowledge of, or involvement in, any such actions,” the lawyer wrote.

Bailakis declined to comment.

Dismissed by ‘political actors’

The DOJ’s sudden dismissal of these cases is not the normal course of events.

Four former DOJ officials – who had not worked on the cases and spoke on condition of anonymity for fear of repercussions – highlighted that the Bailakis case was dismissed not by the career officials who had indicted the case but by political appointees, suggesting political interference.

The experts agreed that the cases were strong and excluded other reasons why they might have been ended, such as a plea deal or second thoughts about the evidence or the arguments of the defendants.

“Probably people were quitting their jobs over this, if I had to guess”

“It looks like there was a political decision to dismiss the cases and the circumstances are highly unusual,” one of the former officials said. 

That’s because, the official argued, it wasn’t civil servants who had signed off on the decision to dismiss the case but rather a political appointee.

“I’ve never seen a counsel to the Assistant Attorney General sign something unless the career staff was refusing to do so,” the former official said. 

The dismissal of the case comes at a time when staffers are increasingly worried that the department could be turned into a tool of the White House.

A lack of evidence – or jurisdiction – seemed highly unlikely, the former official argued.

“That’s the kind of thing that would have been vetted internally before they filed the case,” he said. “So the idea that there is some turnaround in the evidence after the indictment, from the time it was indicted and sealed until July, that seems implausible to me.”  

The timing in the cases was also suspect, the former official said.

“Probably people were quitting their jobs over this, if I had to guess,” the former official, who had worked at the DOJ for over two decades, said, adding that some people had worked on the case for a long time and were likely frustrated to see it dropped last minute.

“It’s incredibly unusual that both of these cases would be dismissed by political actors within the DOJ on the same day.”

It must have been “clear political interference”, he said. “That is the only rational explanation.”

IMAGE: President Recep Tayyip Erdoğan met with U.S. President Donald Trump on the sidelines of a NATO summit on June 24 2025.

The dismissals came shortly after U.S. President Donald Trump discussed defence industry cooperation with his Turkish counterpart, Recep Tayyip Erdoğan, at the end of June. Terlemez, the chief of Arca factory, who was arrested in Belgium, seems to enjoy good ties to Erdoğan: the Turkish president opened his factory in Ankara in 2022. Terlemez’s business partner and Arca co-owner, Savaş Balçık, was in Erdoğan’s AKP party and made his fortune with government contracts, Turkish media reported.

The former DOJ officials declined to speculate on why the Trump administration would intervene in the cases. The White House and the Turkish ambassador to NATO did not respond to requests for comment.

But while the motives behind the dismissal remain in the dark, the consequences are ominously clear, Virginia Canter, chief counsel at U.S.-based Democracy Defenders Action said.

“Not holding these individuals accountable sends a horrific message,” she said. “It means that you’re going to let corruption run free.”

With the help of: Tamedia (Switzerland), DW Turkiye (Turkey), Trevor Aaronson (United States) and Antonio Baquero (Spain).

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Source: https://21stcenturywire.com/2025/10/20/investigation-major-nato-corruption-case-derailed-by-us-political-intervention/